DETROIT, MI -- Michigan's new emergency manager law is complicated and will likely see a number of legal challenges after it takes effect March 28, an expert said today, Jan. 30.

"This is one of the most complex laws I've ever seen, quite
frankly," said Eric Scorsone, a Michigan State University economist and expert on local government finances.

In a seminar he led today in Detroit on "Understanding the new Emergency Manager Law (Public Act 436)", Scorsone compared the legislation to a complex board game in which players have multiple options for
reaching the end.

"It's difficult at best," he said of the law signed by Republican Gov. Rick Snyder in December. "I think there's going to be a lot of questions as
implementation of the law goes forward."

Still, Scorsone said the powers granted to state-appointed emergency managers under the new law are "pretty similar" to those in Public Act 4, the controversial emergency manager law that was rejected by voters in a November referendum.

Under the new law, emergency managers appointed by the governor in cash-strapped cities and school districts can still amend or terminate collective bargaining agreements, alter pension boards and sell public assets with state approval.

The financial triggers, such as missed payroll or bond payments, that prompt a state review of a local government's finances are also similar to the old law, as is the review process for how an entity ends up in a state-declared "financial emergency."

Scorsone said it's important for communities to understand the law. There are several cities in danger of tripping into a financial
emergency, he said, adding that 12 cities in Michigan are close to
having "zero cash."

The major difference in the new law, Scorsone said, is that local governments are given four choices for rectifying their local financial emergency:

Consent agreement, in which local leaders remain in charge but must meet certain conditions in an agreement negotiated with the state.

A state-appointed "emergency manager" that has broad authority to address local finances.

Chapter 9 bankruptcy, with the governor's approval.

Mediation, in which the local government and interested parties meet with a neutral party to resolve financial issues, such as employee contracts.

Scorsone said the choices were built into the law to address one of the chief criticisms of Public Act 4, which was that the law was undemocratic and didn't allow elected leaders enough input.

With the new law, "you could argue if it's a good resolution of the democratic issue or not," Scorsone said.

Emergency managers are already appointed in the cities of Allen Park, Benton Harbor, Ecorse, Flint and Pontiac and the school districts of Detroit, Highland Park and Muskegon Heights.

Those emergency managers will be grandfathered in when the law takes effect in March, Scorsone said.

"How that works exactly may be complicated," he said.

Elected leaders in cities and school districts with emergency managers will also have the power to remove an emergency manager with a 2/3 vote after 18 months.